Shares of the warehouse club operator, which sells everything from carrots to coffins at its cavernous stores, fell as much as 3 percent before the bell Wednesday.
"While Costco has generally been prudent in controlling costs, Q1 selling, general and administrative [expense] was higher than we expected," Cowen and Co. analyst Faye Landes wrote in a note.
Operating expenses rose 5.5 percent to $24.3 million. Selling, general and administrative expenses rose 7.2 percent. Profit rose to $425 million, or 96 cents a share, in the first quarter ended Nov. 24 from $416 million, or 95 cents a share, a year earlier.
Analysts on average had expected the company to earn $1.02 a share, according to Thomson Reuters I/B/E/S.
Sales rose 5 percent to $24.47 billion, but missed the average analyst estimate of $25.35 billion. The company announced quarterly sales last week.
Excluding fuel and forex, same-store sales rose 5 percent.
Rival Walmart Stores (WMT) reported a third-straight quarterly decline in U.S. same-store sales last month and forecast a lower-than-expected profit for the holiday quarter.
Costco, whose members pay up to $110 a year to shop at its big stores and website, operates 648 warehouses, including 461 in the United States and Puerto Rico. It also has stores in Canada, Mexico, the United Kingdom, Australia, Japan and other Asian countries.
Shares of the Issaquah, Wash.-based company were down 1.4 percent at $118.25 before the bell.